(18 February 2009 4:00 pm)

MUMBAI: A Rs 15 billion carriage fee coughed out by broadcasters is hurting the television industry and digitisation is the only way out, according to India Today chairman and editor-in-chief Aroon Purie.

Speaking at the session on 'Footprints & Future: Media & Entertaining Industry Stalwarts share their success stories,' Purie said the industry is plagued by exorbitant distribution costs, lack of transparency, and an inadequate audience measurement system.

Purie, who has business interests in the print, and in television news, and FM radio, urged the government to play an active part in driving digitisation.

"In wake of higher carriage fees charged by the MSOs (multi system operators), distribution cost has risen by 50 per cent in one year. There is a need for transparency," Purie said.

Indian broadcasting is a Rs 230 billion industry and will further grow by 12 per cent. The consumers pay Rs 3 billion while the cable operators charge Rs 25 billion as subscription. The net earning for broadcasters is only six per cent as compared to 30 to 35 per cent that broadcasters from developed countries earn, Purie elaborated.

Purie appealed for transparency in the audience system measurement and felt the Tam data was not sufficient to reveal the exact picture. Digitisation will come in handy but broadcasters would not want this as this would reveal their actual low ratings and invariably affect their ad sales, Purie said.

Speaking on the session, Mahindra group vice chairman and MD Anand Mahindra spelled optimism for Indian economy despite current global economic meltdown. He stressed on the power of the Internet and elaborated on how it helped his company to promote the launch of the company's latest automobile.

Mahindra drew a parallel between the automobile launch promotion and film promotion saying that there were many similarities between these two apparently disparate industries. His final word on the Internet was that a company could afford to ignore Internet only at its own peril.

Mahindra stressed how growth opportunities stem from troubled times. Citing his own example, he said his foray into films turned out to be a disaster. Mumbai Mantra's first project, a Bhojpuri film released on the same day as the Bihar floods, and their maiden Hindi film Sorry Bhai released soon after the 26/11 Mumbai terror attack, flopped.

Turning to the business sector, Mahindra was confident that despite the financial meltdown, the Indian economy would survive. India's agricultural economy is robust enough to absorb the effects of the slowdown and capital is available in the market for the committed entrepreneur.

HT Media chairperson Shobhana Bhartia said the success of her company lay in retaining the core values in a changing market scenario.